Ontario cottage prices expected to rise 17 per cent in 2021 amid COVID-19 pandemic
TORONTO -- Cottage and recreational property sales have seen a buying frenzy since the beginning of the COVID-19 pandemic with double digit increases.
Now a new survey predicts there will be another double digit increase this year of 15 per cent in Canada, and a 17 per cent increase in Ontario.
“This year from Victoria to Moncton, and everywhere in between, we have seen a lift in sales of recreational properties” said Phil Soper, the president and CEO of Royal LePage.
Sales are being driven by many people’s ability to work from home and the historic low interest rates. Its also driven by the fact that some buyers have saved money during the pandemic because they haven't been able to travel.
With scarce supply and high demand, prices have been soaring as some people decide to leave city life behind to move to smaller towns and cottage country.
Soper said the Royal LePage Canadian recreational properties survey found that prices increased by 16 per cent in 2020. The real estate company said it believes there will be another 15 per cent increase nationally in 2021.
“Cottages will be about one-third more expensive over just a 24-month period," Soper said.
Ontario and Atlantic Canada are expected to lead the price increase this year at 17 per cent, with a 15 per cent hike expected in Quebec and a 13 per cent increase in British Columbia.
“I’ve been doing real estate for 20 years and I’ve never seen anything like it," said John O’Rourke with Royal LePage Lakes of Muskoka Realty in Bracebridge.
O’Rourke said many of his clients are families who have decided to make a lifestyle change. They are moving to small towns or cottages because they can work from home due to better internet and cellular service.
O’Rourke said some of the price increases in his area are higher than the provincial average adding “we are actually seeing year-over-year increases of 25 to 30 per cent in some markets."
CTV’s Chief Financial Commentator Pattie Lovett-Reid said, "there is a now blurring of residential properties and cottage properties."
Lovett-Reid said some families, who choose a cottage as their principal residence, may find winters difficult and adds eventually some of those who are working from home could have to go back to the office.
She urges caution before moving into a cottage as a principal residence.
“I'm just saying before you make a lifestyle choice to move to the country, you've got to think about it longer term,” Lovett-Reid said.
“I just don't want people to glamorize cottage life and that it's all rose-coloured glasses because there can be some harsh realities down the road."
The survey also asked Canadians between 25 and 35 years old where they would like to live. Forty-five per cent said they would like to live in a city where 47 per cent said they would prefer small town or country living if they could.